June 19, 2008

Philippine egg farmers urge government to soften regulations on oversupply

Egg producers in the Philippines are asking the government to regulate the industry as the country experiences oversupply of eggs due to overproduction and low demand amid the entry of new players and importation of parent stocks.

The National Federation of Egg Producers of the Philippines (NFEPP) said the regulation would require legislation by Congress or an executive order (EO) from President Gloria Arroyo.

NFEPP president Gregorio San Diego, Jr said his group is discussing with concerned government agencies to lay down the basis and create the laws needed that will save the industry by ensuring a "healthy balance between the supply and demand of eggs in the country."

San Diego said the regulation in the importation of parent stocks, or the hens that produce the layers, from the US, Canada and Europe by local breeders is one aspect that they have to look at.

He said the government does not have the power to control importation as long as local farmers are paying the tariff and are buying from countries with no bird flu cases.

In 2007, San Diego said the importation of parent stocks was 50 percent more than in 2006. This resulted to an increase in the country's annual egg production by 30 percent. In contrast, Philippine's per capita egg consumption is only 88.

San Diego said the demand is expected to be flat this year because of the low disposable income of Filipinos and the government's rejection of the industry's proposal to include eggs in its school-feeding program.

He said the low demand and oversupply has caused farm-gate prices to easily drop to an average of P3.20 per piece. To make matters worse, production cost has risen to P3.50 per piece in some areas mainly because of the increase in feeds prices.

San Diego said the glut in egg and poultry supply will be adverse in the industry with over 15,000 egg farmers. 

He explained that in other countries, egg industry groups have worked closely with their governments to regulate the industry, going as far as regulating the entry of new players and the expansion of existing production levels.